• Stephen Whitehead

    Posted in category News by Stephen Whitehead on 27/04/2012

    Stephen Whitehead's speech from the ABPI Annual Conference 2012 (abridged version)

Ladies and gentlemen, friends and colleagues it is with great pleasure that I add my personal welcome to the 2012 ABPI Annual Conference.

 
Stephen Whitehead delivering his speech

This is my first conference as ABPI CEO, and our theme for today is one that I think defines our industry: innovation.

Why is innovation so critically important to all actors in the healthcare stage – the patients, payers, physicians, and our industry?

And given what we know, the choices available to us and the decisions that are still to be made ... the critical and more timely question is … can we still afford innovation?

We explore this theme in detail throughout the day, and I am pleased to say that we are joined by a line-up of exceptional speakers and panellists to spark discussion, and inform debate ...

So please join me ... and actively participate in today’s exchanges and share your perspectives.

Now, before we can fully consider the question: Can we afford innovation in medicine? Let’s look at the myths we are up against ... we need to get these out in the opening if we are to have a meaningful and constructive conversation:

  • That the drugs bill is out of control.
  • Our medicines are over-priced.
  • The pipelines are empty – they are not by the way!
  • Industry is only interested in selling drugs.
  • Medicines are an added cost – they don’t help solve social or economic problems.
  • The us and them situation.
  • And the biggest myth – that we can’t afford this anymore ... 

These are not just harmless myths, portraying industry as a familiar fall guy ... they are hurdles – they can hold us back from developing joint working partnerships, they can slow down innovation and uptake, and make no mistake, if we let them grow, these myths will end up impacting on patient wellbeing  ...

It could not be more important that we move past these myths, and we support and invest in innovation in medicine – it is critical to our industry and the NHS, and it is critical to everyone else as well. Healthcare and medicine plays a part in all of our lives – whether it is a medicine that saves us, a vaccination that protects our children, or in my case, a medicine that has saved my best friends from cancer  ...

It is the job of this industry to address these barriers and throughout this address I am to ‘de-bunk’ and indulge in some myth busting!

… I think it is, however, important to first pause and consider the environment and the wider context in which we currently find ourselves …

... And when I reflect that it is almost a year to the day – before I had even taken up my post as Chief Executive of the ABPI – that I attended the last ABPI conference ... I still cannot believe how much the industry has changed in my 10 years away, and the feeling that I was coming home ... this industry does a huge amount of good and it is a privilege to be its representative  ...

And ... over the last year I have had the opportunity to look again with fresh eyes and capture the trends which make this a very different industry to the one I left ...

And what have I seen?  Well it is hard to escape several trends that have permeated the global, national and regional operating environments for the pharmaceutical industry:

  1. Falling R&D productivity – The blockbuster drug era is behind us … many medicines are now coming to the end of their patent life. And now to dispel the myth that the medicines bill is out of control – the NHS is set to save over £3bn between 2010 and 2014 due to medicines coming off patent. The investment made early will now pay off continuously. However, this patent cliff has put severe pressure on industry with fewer ‘blockbuster’ drugs in the pipeline, greater regulatory and cost evaluation pressures, the headroom for innovation is narrower than ever before.  The UK already has the most efficient uptake of generics – this is another factor that brings down the medicines bill - however we must make sure that these savings are reinvested into future innovative medicines to ensure greater efficiency and lower costs in the future … The medicines bill is low now because of past investment…
  2. Late stage failures – As diseases are becoming more complex and the cost hurdles ever greater; the challenges in research and development are significant. This is particularly the case in the transition from phase II to phase III studies which have seen a number of promising compounds fail …

    And here we break the myth that we overcharge for our medicines ... Let’s forget the social and economic benefits for a second, and focus on the finances. These are big numbers, it costs £1.15bn to develop a medicine – let’s consider what that really means. Of every 5,000 compounds tested only one will becomes a medicine. That is a huge amount of risk for any industry to carry.
  3. Delay from market authorisation to market access – We have a limited window of opportunity to recoup the costs of R&D and provide appropriate profit to incentivise future investment ... Industry remains the primary vehicle for bringing medicines to market ... 90% of all medicines were created by industry ... with one-fifth of the world’s top 100 medicines discovered here in the UK.  What we are seeing is that this window is getting ever smaller with delays to market access ... most meaningfully this translate into patients not getting access to innovative medicines – For example in the UK uptake of new medicines is significantly slower than the European average. In the UK the use of new cancer medicines is 33% lower than the European average.
  4. Healthcare costs are rising – fuelled by advances in medical technologies, and ageing populations. As the World Health Organisation notes, the world’s population is ageing, and this puts pressure on the care system ... Let’s take dementia as an example ... One of the world’s major causes of disability and dependency among older people: with over 7 million new cases every year, it has a significant socioeconomic impact on carers, families and society ... and also on the social security and health system funding, as fewer working age people have to fund greater proportion of the elderly care ... We need to redefine what it means ‘to grow old’ and support what patients want – whether that is self-treatment, end of life treatment in the home ... it is about choice etc ... and we should note here the UK National Challenge on Dementia launched by Prime Minister Cameron ...but the simple fact is that if we don’t find cures or treatments for age related diseases like Alzheimer’s then, as the population ages, the NHS will become unaffordable ... There is no us and them – we have to work together to solve these problems

So it is clear that the challenges faced by those in the healthcare environment are huge ... There are critical issues to be addressed ... And it is crucial that we do not lose sight of what we stand to lose if we do not get this right ...  

Short term cost considerations/pressures will undermine longer term efficiencies with the net result that long term healthcare costs will actually increase: patients will not get early access to innovative medicines as the UK slips down the launch table due to cost and slow usage.

We need to redefine and better articulate to payers that medicines can represent a saving to the system and they’re not simply a cost ... and to do this we must have a clear understanding of what constitutes as innovative – this is an essential starting point ... and that is why the Office of Health Economics (OHE) will be publishing the 'Many faces of innovation' report. 

In our view, our progress in medicine and healthcare has happened through countless small innovations and the gradual fulfilment of previously unmet healthcare needs ... just as our understanding of the human body and mind is continuously developing, so is improvement in medicine ... we haven’t cured HIV, but the treatment has gradually improved to a stage where the disease is manageable ... combinations are the order of the day not a magic bullet; again in colo rectal cancer combinations have delivered cures ... ultimately, innovations will be defined by the consumer – by the patient – and we need to ensure that this view is preserved.

It’s also within this context that we need to speak to the government about the pricing of our medicines and explain the benefits of a thriving pharmaceutical industry as well as the risks of not having one…

With pricing negotiations just round the corner, we need be upfront and clear about the need to reward the huge risk and uncertainty in developing medicines ... as well as the need to allow sufficient return on investment to fund future innovation ...

The groundwork to ensure these messages are well understood by the government and the public is well underway and will gather pace in the months to come ...

We are fully preparing ourselves for negotiations with Government ... They will be tough ...

Whatever the next pricing scheme looks like though it must have encouraging innovation as its raison d’etre…

If it does, patients, industry and the NHS will be the beneficiaries…if it doesn’t we all lose…

  • But we can’t talk about pricing and innovation without recognition of the cost to the NHS, and ultimately, to the tax payer, of buying medicines ...
  • So I am pleased that the Office of Health Economics have today confirmed that cost of medicines in the UK are proving good value for money and that spending in this area is slowing ... and to further highlight that their forecasts have proven to be remarkably accurate compared to those provided by the Department of Health
  • Their research continues to echo many of the key things we already know about medicines spending already, chief of which is that the UK has amongst the lowest medicines spending in Europe ...
  • They have also highlighted that the spend on innovative medicines is rising much more slowly compared with the spend on generic medicines ...
  • Taken together, these facts are incredibly powerful and demonstrate that with spending on medicines under control – and that myth dispelled – the healthcare system should have greater scope for investment in new life saving medicines ...

If this happens, and we do reinvest savings in to new medicines we will make patients healthier, we can reduce the burden of expensive primary and secondary care and a strengthened pharmaceutical industry can continue to spur economic growth here in the UK ... We will see the benefits of investment impact far beyond the healthcare environment…

By investing in medicines we can tackle complex diseases and give ourselves the opportunity to further adapt, refine and complement treatment which can turn previously incurable diseases into manageable diseases.

There have been challenges and there is no doubt that the financial crisis requires a greater focus on cost reduction in healthcare systems and our industry is ready and willing to partner in managing pathways of care more effectively ...

The various challenges and financial difficulties industry has faced over the past few years has led us into a period of modernisation ... We are seeing greater externalisation, translational relationships, shared investment – shared risk and shared reward – across manufacturers of all sizes ... It simply isn’t us and them anymore, we are not just selling medicines – we have to work together, and we are working together…

This externalisation is beginning to permeate the broader Life Sciences Sector too – we now see industry partnering with academia, with research charities, and with the NHS ...

And I think we as an industry have a huge amount to offer to our partners ...

As well as our medicines, which are the bedrock of the healthcare system, we have unique skills, knowledge and expertise that can be brought to bear on a variety of problems ...

We already have a number of great examples of where our joint working with the NHS has improved health outcomes and my colleagues and I would be happy to share these case studies with you ...

This important partnering work has become a much bigger strategic priority for the ABPI in recent months as we work together with the NHS Confederation to showcase examples to NHS managers through a series of conferences which looks at how different disease areas can be tackled in partnership ...

And just in the last few weeks we issued ground breaking guidance on how our industry should build strong partnerships with the NHS, which has the backing of Department of Health, the Scottish and Welsh governments, and the Medical Royal Colleges ... 

But we are going further still ...

So today I am pleased to announce, yes, another announcement that the ABPI will be recruiting five new members of staff to make up a new ABPI NHS partnerships team.

The team will aim to establish strong, sustainable relationships between industry and key regional NHS figures to address a range of healthcare challenges and spur more rapid access and uptake of new medicines…

The partnership team will comprise of five experienced industry professionals, one for each of the four strategic health authorities in England…

The fifth member of the team will lead the group and provide strategic oversight of their work…

I believe Kevin Blakemore is here actually here today, so please do introduce yourselves ...

In practice, our new team will identify existing barriers to accessing medicines, share best practice across the country, and develop and roll out of regional partnership projects...

Crucially, the new roles will operate to improve uptake and health outcomes in each region generally and will not promote individual companies or products…

Let’s be clear ...

This is a significant investment by the ABPI, but it is the right one because I firmly believe partnership working is the future of healthcare in the UK, and I hope this will be remembered as a decisive step forward in years to come…Please build these resources into your planning as we move forward…

Turning to another myth – that of industry pipelines running dry –  I am hugely encouraged by the new innovative medicines that are coming through, including nearly 500 for Alzheimer’s, 165 of which are in clinical development... These will make a big difference to patient care ... and closer to home we are seeing innovation coming through to patients in the form of recent advances in anti-coagulate treatments, the replacement of warfarin ... the treatment of rheumatoid arthritis, hepatitis C, skin cancer ...

Let me pause at this point to say that, while we are encouraged to see these innovative new medicines coming through the pipeline, these latest advances are wasted if they do not reach patients ... what good is it having a new, more effective medicine if no one is using it? We need to ensure that uptake in the UK is dramatically improved ...

So what will the future look like?

Well it is clear that a solution is not going to happen overnight. What is required is a collaborative approach to dealing with these issues in partnership ... The issues are too big and too complex to be dealt with in isolation; a wider debate is necessary and industry sees itself as a partner in this…

So in conclusion…

Without medical innovation we have no new medicines ... diseases evolve – we have to innovate just to keep up ... Medicines are the bedrock of the healthcare system. Without them the NHS would not be sustainable and without rapid adoption of innovation it cannot hope to survive. I firmly believe that if we do not find new medicines to cure or treat age related diseases like Alzheimer’s, then the NHS will become unaffordable and it will collapse; we will lose patients we could have saved ...

I do not undersell the contribution of industry. Is innovation affordable? The consequences of not innovating are frankly unacceptable:

So my argument is that if we want;

  • the UK to still be a major player creating innovative medicines of the future and contributing to the health and wealth of the nation
  • the health system to secure lower long term and sustainable overall costs
  • to solve unmet clinical need
  • and most importantly if we want to ensure the survival of our NHS, and we want to ensure that patients receive early access to innovative medicines that could save or improve their lives, then the answer is clear: we cannot afford not to innovate!
top 
 
Print this page icon Print this page
 
Please choose the subject of your enquiry from the list below:
 
Code to enter for submitting the form
Enter the above code here:
Can't read? Try different words.